Costco Is No Longer Offering This Member Perk
Costco is known for having a warehouse full of anything and everything you could think to fill a house with. From 72 pounds of parmesan cheese to a saxophone starter kit, or even a "just add water" emergency meal kit with 110 servings – Costco has it all. The one thing it doesn't offer anymore is the house to put these things in, however.
As of May 1, Costco is no longer offering a mortgage program to its members, according to its website. The company has instructed any members in the process of getting a loan to contact the lender they have been working with, of which Costco was affiliated with eight at the time: Box Home Loans, CrossCountry Mortgage, Lending.com, Mutual of Omaha Mortgage, NASB, NBKC Bank, Real Genius, and Strong Home Mortgage.
Costco started the mortgage program in 2020 and so far has not offered any explanation as to why it ended. After the news was announced, though, one member on Reddit speculated that there was "Likely not enough room for profit in the referrals, with rates going up."
Costco itself was not a lender and did not have a direct role in the mortgage process. What the program did offer was a cap on lender fees linked to the loan transaction. Without the program's cap, borrowers could expect to pay 1%, which would be $1,000 for a $100,000 mortgage. Lender origination fees at Costco were capped at $250 for Executive members and $550 for other members.
Some members are upset about the loss of the service, which they cited as a major reason for joining the club.
"I used Costco for my refinance last year and was able to snag a 2% for 15 years and that too with 3-4K lender credit if I remember," a commenter posted to Reddit in early May. "I probably don't need to do it again, but it was a great addition to my existing membership! My experience with the 3rd party was hassle-free as well."
Although the warehouse chain will no longer be offering it, coincidentally, Walmart announced it launched its own mortgage program in early March. The supermarket giant has struck a deal with Lenders One Cooperative to lease retail space in Walmart stores, where it will sell mortgage products and services. While the spaces are currently active in only three Walmart stores, the mortgage cooperative has said it plans on expanding to more stores.
But while Costco may not be able to finance your dream home, the warehouse still does dream vacations.
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